(Yicai Global) July 23 -- China continues to be one of the world's most attractive countries for overseas investment, despite a number of manufacturers heading out the door, according to a government minister.

While some foreign companies have left, they are mainly small and medium-sized businesses and such behavior is not unusual, Industry and Information Technology Vice Minister Xin Guobin said at a press conference today.

Xin said it is normal for capital to flow to places where operating costs are lower, and the effects on China's economic growth, industrial advancement and levels of employment are controllable.

Of 588 foreign-backed manufacturers based in the southern economic powerhouse of Guangdong province, just 1.4 percent transferred production out of China to Vietnam, Thailand and Malaysia last year, Xin said, adding that 1,918 foreign-funded projects moved in.

Despite a 40 percent drop in overseas investment worldwide last year, China's manufacturing sector still saw a 23 percent gain in financing. China boasts a huge domestic market, complete industrial system and highly efficient infrastructure, Xin said. Since 2008, China has remained in the top three countries for the amount of foreign investment used.

China continues to attract global investors. In the first half, there were 20,131 new foreign-funded firms established nationwide, and the amount of overseas investment used rose 7.2 percent year on year to CNY478.3 billion (USD69.5 billion), according to statistics released earlier by the Ministry of Commerce.

China will continue to open up the manufacturing sector by expanding the scope for foreign investment, and will bring in a number of stimulus policies to optimize the business environment, reduce taxes and business fees, lower entry thresholds to sectors and cut corporate financing costs, Xin added.